US end-market analysis for Kenyan cut flowers
Cut flowers are a major export industry in Kenya. Kenya presently ranks first among world exporters of roses to the European Union (EU), with a market share of 38 percent. However, the country has not yet made as deep of inroads into the cut flower market in the United States (U.S.). Kenyan cut flower exports to the U.S. have grown since 2010, but the country’s market share remains small, standing at 1 percent. This report analyzes emerging opportunities to increase Kenyan flower exports to the U.S. while taking advantage of the benefits granted under the African Growth and Opportunity Act (AGOA).
In 2016, Kenya ranked as the twelfth greatest supplier of cut flowers to the U.S. Nearly 90 percent of the cut flowers imported by the U.S. come from three countries: Colombia (59 percent), Ecuador (22 percent) and the Netherlands (7 percent). Colombia and Ecuador, who make up more than 80 percent of the imported flowers, present stiff competition. The countries profit from longstanding commercial relationships with the U.S. and geographic proximity, which reduces freight and transport costs. Both countries enjoy duty-free access to the U.S. market, as does Kenya.
Nonetheless, Kenya has a strong, competitive cut flower industry that is ready to explore new markets. The industry is profitable and technically competent, it has developed efficient logistics to the European markets and it offers high-quality flowers at competitive prices. If the industry can use these strengths and adjust to the U.S. market, there is an opportunity to develop a market niche for its flowers, including roses and other breeds.
This report assesses the U.S. market and offers the following recommendations for Kenyan cut flower exporters:
- Expand and consolidate trade linkages with U.S. buyers.
- Improve Kenyan flowers’ competitiveness through quality assurance, improved logistics and packaging. Factors directly contributing to the quality of flowers shipped long distances, particularly postharvest handling, packaging and an appropriate cold chain, need strengthening.
- Position Kenyan roses in a different, but not inferior, market niche from Colombian and Ecuadorian roses and consider the potential of lilies, carnations and chrysanthemums, which Kenya currently exports and the U.S. imports, but are not a large part of Kenya-U.S. trade.
- If exporters decide to access the bouquet market, Kenya has the capacity to source a wide variety of good quality products including cut foliage. This may be achieved either by elaborating bouquets at origin or liaising with a bouquet maker in Miami wishing to import specific flower types.
- A strong connection between Animal and Plant Health Inspection Service, the phytosanitary authorities in the U.S., and the Kenya Plant Health Inspectorate Service (KEPHIS) needs to be developed to increase confidence in Kenyan products at the U.S. borders. KEPHIS also needs to develop pest risk analyses on specific flower types (particularly roses), which follow U.S. guidelines.
- Strategic alliances and joint investments should be built with exporters from countries that have an advanced flower sector and can bring their technology, marketing and distribution capacities to the table.
- Supply should be leveraged with flowers from other African countries that might use Nairobi airport for shipping of their produce.
- Efforts to brand Kenyan flowers as unique are encouraged during promotion efforts, particularly for bouquets. Selling wholesale will have a lower impact as flowers will likely be mixed with those of other origins before reaching the end consumer.